Silicon Valley Power to stop buying coal power from power plant

Silicon Valley Power, the city of Santa Clara’s municipal electric utility, will become a coal-free utility on December 31, 2017 when it ends electricity imports from a New Mexico coal-fired power plant.

SVP will replace the power from the San Juan Generating Station with cleaner energy from renewable and natural gas resources for its 53,000 Santa Clara customers. The Federal Energy Regulatory Commission issued its final approval of the move on December 30.

SVP currently distributes about 36 percent of its power from state-mandated renewable resources, far exceeding California renewable energy requirements. Overall, more than 50 percent of the power supplied by SVP is carbon-free.

Since 2011, SVP has examined options to extract it from coal-powered resources that 32 years ago were reliable sources of affordable electricity to supplement seasonal hydroelectric generation and reduce the need to purchase expensive short-term power. SVP and two other Northern California municipal utilities formed the M-S-R Public Power Agency in 1980 and purchased the interest in the San Juan Generating Station in 1983.

While the San Juan power provided just 10 percent of SVP’s electricity, the coal-fired power accounted for 50 percent of the utility’s carbon emissions. Confidential negotiations by SVP began four years ago to pull Santa Clara out of the San Juan contract due to the pollution emissions, liabilities associated with upgrading the plant to reduce emissions, and escalating costs associated with the San Juan facility.

In 2012 SVP began receiving electricity from its share of the Lodi Energy Center, a natural gas generation plant using modern technology that limits carbon emissions.

“Silicon Valley Power has been committed to eliminating coal as a source of electricity for our customers and turned toward a combination of new renewable resources and the ultramodern Lodi Energy Center to replace the 51 MWs of power from San Juan,” said Larry Owens, SVP Manager of Customer Services.

“We will be coal-free two years earlier than the 2020 deadline called for in the city of Santa Clara’s Climate Action Plan, effectively reducing the carbon footprint of our power by over 50 percent,” Owens said.

SVP expects to remain well ahead of state or federally mandated renewable requirements for the foreseeable future while keeping electricity rates among the lowest in the state.

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